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ID: 187803

Does villager social capital hinder poverty targeting? Evidence from poverty-stricken county of Western China / Cheng, Xiaoyu; Wang, Jianying; Chen, Kevin Z

Chen, Kevin Z	Journal Article
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Summary/Abstract

Poor targeting performance is a common concern in the increasingly implemented decentralized targeted antipoverty programs in developing countries. Different from previous literature that focuses on targeting errors caused by elite capture, we explore the role of villager social capital as a whole in poverty targeting in the context of China's Targeted Poverty Alleviation (TPA) policy. The empirical analysis uses a unique census-type data from three administrative and seventeen natural villages in the poverty-stricken county in Western China in 2017. Villager social capital is measured by a proxy index by combing reciprocity, support time, gift expenses, and political connection of villagers. We verify that the villager with rich villager social capital is more likely to be a beneficiary of TPA by using instrumental variable estimation. The nonpoor can mobilize their higher level of social capital than the poor to capture the beneficiary quotas that should be allocated to the poor, resulting in mistargeting. Such effect persists after controlling political elite capture effects. The findings point out villager social capital is the root cause of poor targeting in decentralized targeting programs in rural China and also lend new support from China to the classic debate on social capital is not the capital of the poor.

Key Words

China ; Social Capital ; Political Connection ; Targeted Poverty Alleviation ; Decentralized Poverty Targeting

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ID: 110246

Global recession and China's stimulus package: a general equilibrium assessment of country level impacts / Diao, Xinshen; Zhang, Yumei; Chen, Kevin Z

Diao, Xinshen	Journal Article
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2012.

Summary/Abstract

A dynamic computable general equilibrium model is developed to assess the impact of the recent global recession and the Chinese government's stimulus package on China's economic growth. By designing two scenarios - one with and one without the stimulus package - the model results show that GDP growth rate in 2009 could have fallen to 2.9% without the stimulus package, mainly as a result of the sharp decline in exports of manufactured goods. Under the stimulus scenario, with the generated additional demand on investment goods, the Chinese economy grows 8-10% in 2009 and the succeeding years. The model also measures the overall gains of the stimulus package, and the cumulative GDP growth difference between the two scenarios for 2009-15 is about RMB76 trillion.

Key Words

Global Financial Crisis ; China's Stimulus Package ; General Equilibrium Modeling

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